Wheat Sep '26 (ZWU26)

Description

Wheat is a type of cereal grass. Wheat was a wild grass before humans began cultivating it for large-scale food production. It has been grown in temperate regions and cultivated for food since prehistoric times. Wheat is believed to have originated in southwestern Asia. Archaeological research indicates that wheat was cultivated in the Nile Valley about 5,000 BC. Wheat is not native to the US and was first grown here in 1602 near the Massachusetts coast. The common types of wheat grown in the US are spring and winter wheat. Wheat planted in the spring for summer or autumn harvest is mostly red wheat. Wheat planted in the fall or winter for spring harvest is mostly white wheat. Winter wheat accounts for nearly three-fourths of total US production. Wheat is used mainly for human consumption and supplies about 20% of the food calories for the world's population. The primary use of wheat is flour, but it is also used for brewing, producing oil and gluten, as straw for livestock bedding, as livestock feed, for hay, silage, and other products.

Wheat futures and options are traded at the CME Group, ICE Futures US Exchange, the Matba Rofex exchange (Argentina), Sydney Futures Exchange (SFE), Euronext (Paris), Zhengzhou Commodity Exchange, and the South Africa Futures Exchange. The CME's wheat futures contract calls for the delivery of soft red wheat (No. 1 and 2), hard red winter wheat (No. 1 and 2), dark northern spring wheat (No. 1 and 2), No.1 northern spring at 3 cents/bushel premium, or No. 2 northern spring at par.

Prices - CME wheat futures prices (Barchart.com symbol ZW) moved higher in early 2025 and posted the 2025 high of $6.09 per bushel in February. Freezing weather in the central US in February damaged some of the US winter wheat crop that was unprotected by snow, pushing prices higher. Tighter global supplies also supported prices, as the USDA cut its 2024/25 global wheat ending stocks estimate to a 9-year low of 257.6 MMT in the February WASDE report. Easing trade concerns boosted wheat prices after President Trump in February paused tariffs on Canada and Mexico, which accounted for a quarter of US wheat exports. Wheat prices then came under pressure in May as US trade policies undermined foreign demand for US wheat. The USDA in the May WASDE report cut its US 2025/26 wheat export forecast and raised its US 2025/26 wheat ending stocks estimate to a 6-year high of 923 million bushels. Prices then turned higher in June as heavy spring rains in the central US delayed the winter wheat harvest. Also, foreign demand picked up amid a weak dollar, as 2025 US wheat export commitments through June were the highest in a decade. Wheat prices came under pressure in Q3 on signs of a bumper wheat harvest in Russia, the world's largest wheat exporter. Russia's 2025/26 wheat production estimate rose to 85.5 MMT in August, potentially boosting Russian wheat exports by 1 MMT. Wheat prices slid into October, when they fell to a 5-1/2 year low of $4.92 per bushel. Abundant wheat supplies pressured prices after the USDA estimated US quarterly wheat stocks as of September 30 were higher than expected at 2.12 billion bushels. Crop data from October 1 to November 12 was sparse due to the US government shutdown. The USDA, in its December WASDE report, raised its 2025/26 global wheat production estimate to a record 837.8 MMT. Wheat prices finished 2025 down by -8.2% yr/yr at $5.01 per bushel.

Supply - World wheat production in the 2025/26 marketing year rose by +5.2% yr/yr to a new record high of 42.167 million metric tons. The world's largest wheat producers in 2025/26 are the European Union with 17.1% of world production, China with 16.6%, India with 14.0%, Russia with 10.6%, and the US with 6.4%. China's wheat production in 2025/26 remained unchanged yr/yr to a record 140.070 million metric tons. The European Union's wheat production in 2025/26 rose by +17.9% yr/yr to 144.000 million metric tons. The world land area harvested with wheat in 2025/26 fell by -1.1% yr/yr to 220.0 million hectares (1 hectare equals 10,000 square meters or 2.471 acres).

US wheat production in 2025/26 rose by +0.3% yr/yr to 1.984 billion bushels. The US winter wheat crop in 2025 rose by +3.5% yr/yr to 1.401 billion bushels, which was well below the record winter wheat crop of 2.097 billion bushels seen in 1981. US production of durum wheat in 2025 rose by +7.7% yr/yr to 86.223 million bushels. US production of other spring wheat in 2025 fell by -8.7% yr/yr to 496.760 million bushels. The US states producing the largest amounts of winter wheat in 2025 were Kansas (with 24.7% of US production), Washington (8.7%), Oklahoma (7.6%), Montana (7.1%), and Texas (6.1%). US farmers planted 45.328 million acres of wheat in 2025, down by -2.0% yr/yr. The US wheat yield in 2025/26 is expected to increase by +6.0% yr/yr to 54.8 bushels per acre.

Demand - World wheat utilization in 2025/26 rose by +2.4% yr/yr to 819.7 million metric tons. US consumption of wheat in 2025/26 rose by +0.6% yr/yr to 1.154 billion bushels, below the 2012/13 record high of 1.389 billion bushels. The wheat usage breakdown in 2025/26 is 84.2% for food, 10.4% for feed and residuals, and 5.4% for seed.

Trade - World trade in wheat in 2025/26 rose by +4.4% yr/yr to 219.8 million metric tons. US exports of wheat in 2025/26 rose by +9.0% yr/yr to 900.0 million bushels. US imports of wheat in 2025/26 fell by -19.4% yr/yr to 120.0 million bushels.

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